"I think that the global economy does not support the current valuations," he said Wednesday. Corporations "have had record profits, largely because they are buying back their own shares and so the number of shares is diminishing where revenue growth is basically flat."

In fact, he said the bond market, which is more sophisticated than the stock market, does not believe in a strong economic recovery and neither does he.

Faber has been calling for a major correction for years. So far, the market hasn't followed his theory, but he said that could be setting it up for an even bigger fall.

"Since 2012, I said it would be healthy for the markets to have a meaningful correction, but it could be that we are in a year like '87 when we go straight up and then we don't have a correction but a more significant crash," he said.